Big Government desperately cooking the books to hide massive economic inflation storm that is forming just off shore as result of its spending

Buried in the latest report from the Bureau of Labor Statistics (BLS) on the Consumer Price Index was some disconcerting news. On the surface, there appeared to be little to be concerned about, with the index “for all items, less food and energy” rising just 0.2 percent in April. On an annual basis, the BLS “all items” index increased just 3.2 percent over the past 12 months.

However, that 3.2 percent was the highest since October of 2008, reflecting increases in energy of 19 percent, and gasoline of 33 percent over the last twelve months. And looking even more closely at the report, the energy index has increased ten months in a row, while the fuel oil index is up an astonishing 35 percent.

Prices of goods in the pipeline, as measured by the Producer Price Index showed an increase of 0.8% (10 percent on an annualized basis) in April, higher than the 0.7 percent increase in March. The BLS was candid in its assessment of these numbers, saying “The costs of corn, wheat, cotton and other commodities have also jumped due to strong global demand. That’s raised worries among some economists that consumer prices could also jump and inflation could surge. ”

Keeping in mind that the BLS continues to measure only the effect of the already increased supply of money has on prices, eventually and certainly, such numbers are primarily for government purposes and have little basis in the reality faced by consumers on a daily basis. John Williams has long presented more realistic numbers here, which show inflation approaching 10 percent on an annualized basis, and moving sharply higher.

According to Jim Rogers, Chairman of Rogers Holdings, the CPI numbers are all lies:

Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20-25% of the CPI and housing was going up, they didn’t count it. When rents weren’t going up, and then when housing prices started going down, they counted it.

These price increases are having the expected damping effect on consumers, as noted by Bloomberg: “Retail sales rose in April at the slowest pace in nine months and consumer sentiment declined. ”...

Few are suggesting that hyperinflation is just around the corner for American citizens, but it is clear that the stage has been set for just such a blow off. As John Maynard Keynes wrote:

There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one in a million is able to diagnose.